» Landlord tips

Wanting to attract quality tenants? Here are 10 things they want in their rental

BMT team — Sun, 23 May 2021 23:18:45 +0000

The current rental property market is fierce, making it harder to find the quality tenants for your investment property amongst the applicants. Quality tenants mean a consistent cash flow, long-term leases and lower risks of tenant-related property damage. Holding a property that has what tenants want in a rental is what will help you land the perfect tenant. 10 things quality tenants want in a rental property 1. Location Tenant location demand largely depends on your tenant target market. So, this is where it pays to do your research before buying your next investment property. If your ideal tenant is a working family, then a family-friendly location with ample schooling options in the school zone should be your priority when narrowing down the location of your property. But if your target market is working professional singles or couples, then urban convenience should be top of your list. 2. Maintenance levels Manageable maintenance levels of a property is a win for you, and often for your tenants. This means that while an immaculate garden with exotic but needy plants may look great, it’s not favourable for tenants without a green thumb. The same applies for the indoors, you want areas like the bathroom to be easy to maintain and clean and the floor covering option needs to withstand high levels of traffic. There’s a long list of high maintenance vs low maintenance features of a home. The key takeaway here is to go with the option that’s going to make it easier for yourself and your tenants. 3. Security and privacy When your tenant feels the rental is like home, they will treat it that way. This means they need to feel a level of privacy. Try doing things like giving plenty of notice before scheduled inspections and allowing them to organise times with any required tradesperson. Then comes security. By this we don’t mean security cameras in every corner, alarms and high barbed-wire fences. Getting the basic security features will help your tenant feel more at home. This includes sturdy locks on doors with the option of an interior latch, lockable windows and security screens. 4. Parking Luxury in built-up urban areas comes in the form of off-street parking. While a driveway is dependent on the space you have, you should always offer it as part of the rental if possible. The convenience is a sure-way to attract tenants in competitive urban areas. 5. Little details that makes it feel like a home It’s the little things that count when it comes to rentals and attracting the quality tenants. This means avoid the stereotypical rental property features like painted-shut windows and dodgy DIY repair jobs. Having the property move-in ready with no need for repair should always be at the top of your list before leasing the property. While the upfront costs may seem to outweigh the benefits, it’s important to remember that repairs are 100 per cent tax deductible in the same financial year if the property is genuinely available for rent. If the repairs are completed before the property is available for rent, they can be depreciable as part of a capital improvement. 6. Approachable landlord and property manager Clear lines of communication and transparency are essential when it comes to getting and keeping quality tenants. This is where you need to count on your property manager. Communication is key at the very beginning to ensure expectations with your tenant are met. Factors like repairs also need to be dealt with in a timely manner to keep your tenants happy. Transparency around considerations such as rent increases and inspection requirements are also important for any tenant-owner relationship. When this is done correctly, reliable long-term leases are often obtained. 7. Storage Incorporating storage with the property will make it more comfortable for your tenants. This applies to both the indoor and outdoor areas. Providing an area outside the living space where possible, like a storage shed, can go a long way in terms of tenant-appeal. A big deterrent for rentals is when the owner is using part of the property, like the garage, for their own storage and making it unavailable to the tenant. It’s understandable given they own the property but it’s equally as important to allow the tenant to use the property like it’s their own. 8. Heating and cooling Australian summers can be unforgiving, while winters in some areas can come as a body-shock following the warmer months. Ensuring your property has adequate temperature control is something that will draw tenants in. This means well-suited ventilation to the environment and investing in assets like air-conditioners and heaters to make it a more comfortable place to live. 9. Natural lighting Natural lighting is a healthy way to enjoy the indoors. It can lower electricity bills and bring warmth inside even in the depths of winter. Lack of natural lighting can be inevitable due to the property location, but where it can be helped it should. From the first inspection, natural lighting can make a big impact on prospective tenants. This means providing window coverings that can provide privacy and the option of natural light – like venetian blinds instead of heavy block-out curtains. Or if you are planning on building your next investment property, strategically place windows where they can take full advantage of the sunlight. 10. Modern or upgraded Style preferences change, but generally tenants like to have ‘nice things’ and a space that doesn’t feel outdated. This doesn’t mean only purchase brand-new investment properties – we know realistically this isn’t always an option. But upgrading areas of the property that will add to the tenant-appeal factor can be worthwhile, such as renovating a kitchen, bathroom or removing old carpet and replacing it with new floor coverings. Tenant-appeal isn’t the only benefit of new or upgraded properties. You will also benefit from heightened depreciation deductions. New properties produce higher depreciation deductions in comparison to their second-hand counterpart. Meanwhile, any renovation you complete will unlock further depreciation […]

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What is landlord insurance and what does it cover?

BMT team — Wed, 14 Aug 2019 01:15:13 +0000

Under-insurance and over-insurance can put financial pressure on property investors, yet research shows that more than half of people believe they’re sufficiently insured based on an inaccurate valuation. An Insurance Council of Australia report from 2014 found a staggering 83 per cent of Australians are risking their homes and other valuable assets by not having enough insurance. This is troubling for property investors given they could either be paying too much for their insurance or at risk of losing thousands due to inadequate cover. Landlord insurance is particularly important for property investors given there are several risks involved in leasing out a property. What is landlord insurance? Landlord insurance is a type of insurance policy designed to protect property investors from tenant-related risks including loss of rental income and damage caused by the tenant. Landlord insurance may protect you from: Malicious damage by tenants Accidental damage by tenants Theft or burglary by tenants Loss of rental income due to tenant default Loss of rental income due to an insured event where the property becomes partially or wholly untenantable Legal expenses involved in evicting a tenant As landlord insurance is an investment expense, it can also be claimed in your annual tax return. It’s important to note that each landlord insurance policy will differ. Some policies will cover all scenarios listed above, while others will only offer limited cover. Why is landlord insurance important? Property is usually the single largest investment you make and underestimating the importance and level of insurance can be devastating. Having landlord insurance offers peace of mind should the unexpected happen. It also offers protection from risks that aren’t always covered by other insurance policies such as home and contents or building insurance. For example, building insurance typically protects the landlord’s property in the event of a fire, flood or storm but doesn’t necessarily cover for damage caused by the tenant. So, if a tenant maliciously vandalises your rental property, you may be out of pocket if you have inadequate insurance. While most tenants are responsible and will respect your property, it’s worth protecting yourself from the few who may not. Given most investors rely on rental income for cash flow, landlord insurance can provide a financial safety net. Organise insurance today So, what’s the best way to organise landlord insurance? As you start researching, you’ll discover there are many policies and providers to choose from. It’s important to think about the type and level of cover you want for your investment property. BMT Insurance helps investors find house, contents and landlord insurance and works with some of Australia’s most experienced providers to select the most suitable and cost-effective cover for you. As BMT Insurance is partnered with BMT Tax Depreciation, your required cover will be determined by experts who have access to the expertise and knowledge of construction cost consultants within the BMT Group. BMT Tax Depreciation’s construction cost consultants are equipped with the skills to accurately calculate the replacement cost of your property, which helps BMT Insurance determine the right level of cover for your most valuable asset. For more information, contact BMT Insurance on 1300 268 467 or Request a Quote.

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Should you include utilities for a rental property?

BMT team — Mon, 22 Jul 2019 00:29:09 +0000

There are many important decisions to make as a landlord and balancing outgoing and incoming expenses is paramount. Landlords want to maximise cash flow and boost the return from their investment property. When considering how best to do this, questions surrounding whether to include utilities for a rental property often arise. Contents Advantages Disadvantages Other considerations Advantages of including utilities in a rental property One of the main advantages of including utilities for a rental property is that bills don’t need to be double handled. Rather than receiving a bill, sending it to the tenant and collecting the sum in time for payment, the landlord can simply include it in the cost. This gives the landlord the potential to charge a slightly higher rental price. Plenty of prospective tenants will love the idea of having utilities included with the rent as it reduces stress and effort on their part. For electricity and gas, if a premise is not separately metered the landlord is required to include utilities for the rental property. A premise is considered separately metered if the usage by the tenant is measured distinctly from the usage of the landlord. While this is a requirement under most tenant agreements, it can prove to be beneficial for the landlord. Including utilities will save the landlord time and effort in calculating the percentage of energy used by the tenant. Utilities paid by the landlord are also tax deductible. The Australian Taxation Office governs legislation that allows landlords to claim an immediate deduction for costs like electricity and gas in the year the expense was incurred. If the tenant covers the cost of electricity and gas, the landlord cannot claim this. Disadvantages of including utilities for rental property Including utilities can be beneficial but there are certain drawbacks. The landlord will have higher financial responsibilities and even heightened liability. There is also the risk of tenants having an ‘all-you-can-eat’ attitude. That is, when tenants don’t have to pay for consumption they often consume more. The landlord may end up paying a hefty amount on top of their existing expenses if this is the case. If electricity or gas rates go up, this will also increase the utility bills. Even if a landlord has previous billing information to base their pricing on, utilities can be unpredictable. Price fluctuation and market conditions can both affect the price you pay each month. Other considerations If a tenant is paying for utilities, will the payments be fixed or variable? It’s important for landlords to consider this before leasing the property. A fixed rate is typically more convenient for both parties and can even strengthen the landlord-tenant relationship. On the other hand, a variable rate is harder to manage but is more reflective of the actual costs being paid. Landlords should also think about the structure of utility payments. Will the tenant pay for utilities and rent as two separate expenses or as one total cost? Will there be an additional fee if utility payments are late? It’s important to remember there is no right or wrong way when it comes to utilities for a rental property. There are several advantages and disadvantages for each investor scenario. Careful planning and proper consideration of your financial situation will help you make the best decision for your investment property.

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Tips to family proof your investment property

BMT team — Wed, 19 Apr 2017 23:31:20 +0000

Safety is one of the primary areas of concern for tenants. In fact, a Real Estate View survey conducted in 2014 showed that 53.9 per cent of renters ranked safety as always important. While both landlords and tenants have responsibilities regarding the safety of a rental property, there are some areas landlords should watch out for to keep their tenants safe and to avoid any legal risks. Figures from Australia’s child accident prevention foundation Kidsafe also highlight the importance of ensuring a property is free from hazards. According to the Kidsafe website, every year around 250 Australian children aged fourteen and under are killed and 58,000 are hospitalised by unintentional injuries. Kidsafe notes that most of the accidents which occur inside homes and backyards can easily be prevented. Landlords should also be aware that ensuring a property is safe for tenants, particularly for those with young families, could increase the number of rental applicants and reduce vacancy periods. To assist landlords, we’ve compiled the following tips to help ensure a property is safe for rent and appealing for those who have young families. Install cleats to secure any blinds and curtains Landlords are obliged to ensure all loose cords and chains for curtains and blinds are able to be secured before renting a property. This is to help prevent children from using them to climb to look out of windows, accidentally being tangled, or worse suffering from strangulation. Since the early 1990’s at least eighteen deaths of children have occurred as a result of cords not being correctly secured. While it’s the tenant’s responsibility to ensure any curtain or blind cords are tied appropriately and to place furniture out of reach, the landlord is responsible for installing the cleats. If an accident occurs and blind and curtain cleats are not in place, the landlord could potentially be sued for negligence. Landlords should ask their Property Managers to check all internal window coverings, blind and cord cleats to ensure they are as safe as possible both prior to rental and during regular inspections. Weigh up whether pools and play equipment are positive inclusions Swimming pools and children’s play equipment are popular features in many Australian homes, but this doesn’t mean these items always add value for landlords or entice potential tenants. While swimming pool items make a splash when it comes to adding depreciable value; a landlord must ensure these areas are safety compliant, meet regulations for their state and are well maintained. Safety is also a concern if you’re planning to rent a property with children’s play equipment in the yard. If you decide that the positives outweigh the negatives and keeping these items at the property will attract a young family; consider installing gated areas to separate play areas, ensure playgrounds are free from trip hazards and check there are adequate fall zones and the areas are surfaced with appropriate materials to prevent injury as a result of falls. Be mindful of balconies, balustrades and windows If the property you are renting has multiple levels or is not on the ground floor, there are some precautions which can be taken for balconies, stairways, hand rails and windows. While multi storey homes may only require locks on entry doors and windows in the ground floor, including these on doors and windows which exit on to balconies or open on the second floor can provide extra security and additional safety to prevent falls. If renting to a family, often landlords will be asked to allow the installation of child proof gates at the top of stairways or to dangerous areas. Being receptive to allow such changes, or even installing these items can go a long way to keep tenants with families happy. Check the garden for dangerous shrubs, trees and pests One area easily missed when checking for hazards is the garden. Plants, shrubs and trees can all provide potential dangers to tenants, children and pets. Regular checks will ensure there are no broken tree branches which could fall and cause damage to the property or to its occupants. Some plants are potentially poisonous to children or pets that play in the yard. Prior to starting a lease, consider removing such plants or asking a professional to remove them. Often parents with young families may not have the time to keep they yard well maintained. Including regular yard maintenance and completing regular pest inspections can put your tenants mind at ease and also be a reason to keep them signing their lease for years to come.

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Pros and cons of letting furnished versus unfurnished

BMT team — Mon, 30 May 2016 07:12:31 +0000

There is no right answer as to whether to let a property with or without furniture. Different properties will be better suited to each approach and there are a range of considerations. Furnished properties are ideal for short term tenants and can be a great option for overseas visitors. However, going this route means your property’s occupancy levels can fluctuate dependent on the strength of the currency, changing seasons, holidays, and major events. The long term appeal of unfurnished houses is impacted less by these external factors. The flipside is that during any vacant periods you can use your house as a holiday home and take advantage of the perks of having a second property without having to move furniture in and out regularly. In this article we will explore: The type of tenants you wish to attract Property size and location Time available and financial situation How much do you want to spend setting it up? Depreciation advantages of a furnished property Do your homework The type of tenants you wish to attract The long term appeal of unfurnished houses is impacted less by these external factors. The flipside is that during any vacant periods you can use your house as a holiday home and take advantage of the perks of having a second property without having to move furniture in and out regularly. An unfurnished property is more likely to appeal to tenants looking for a home over the long-term. Typically, this means that leases will be for twelve months and tenants will bring a house worth of furniture with them. Some tenants prefer the opportunity to furnish the property as they see fit and will be put off by a landlord’s furniture as this may mean they will feel required to store the items at a cost. As people who are looking to create a home rather than just having a place to stay, long term lessees are often thought to take better care of the property as a whole. Furnished properties are aimed at travellers and young tenants who haven’t accrued large amounts of furniture yet. The leases reflect the instability of such tenants and are usually between three and twelve months long. With this type of property, the renter is able to move in quickly and makes them the ideal option for people arriving from overseas and need a place in a hurry. Property size and location Larger properties with more than two rooms are more suitable for long term, unfurnished letting. They tend to be occupied by older people and those with families, who will generally have their own furniture. A big home will be expensive to furnish, which is why the smaller one and two bedroom houses offer the best value for landlords wishing to pursue the furnished route. When a property is furnished, there is a whole spectrum of options for the landlord. They may simply choose to include a washing machine and a refrigerator, or alternatively fully equip the property with everything from linen in the closest to cutlery in the drawers. Central and inner suburb properties are more suited to the letting of furnished properties. Their location makes them ideal for people arriving for a short term stay, or to use as a stop-gap while they settle and find a permanent place. The proximity to public transport and the city makes them perfect for international travellers, and as such, can be let at a premium rate. Time available and financial situation Due to the short term, high turnover nature of furnished properties, they tend to require the investment of more time than an unfurnished home. The length of the lease on the latter means that the landlord can essentially set it and forget it, leaving the property manager to take care of any issues that arise. When a property is let through a series of short term leases and an ever-changing set of tenants, the owner is required to sign off of each new occupier, ensure the furnishings are still in good condition and replace what isn’t. This is in addition to the host of other tasks that long term letters only need to do once a year at most. This can make furnished, short term letting a time consuming process for their owner. While not a rule, the short term nature of a furnished property means that it may go through periods of vacancy. A long term lease offers the security of a constant stream of revenue for at least twelve months, while a furnished property could only guarantee income for a matter of weeks, or even days. If an owner is unable to absorb the cost of a property sitting vacant for any period of time, it is advisable to make the property’s furnishing options flexible. Letting agents prefer being able to offer a prospective tenant the option of full, partial or no furnishings as it opens the house up to a wider market of renters. How much do you want to spend setting it up? Perhaps the main consideration for most people, is how much they want to spend in the initial set up of the house. Buying furniture for an entire house is an expensive process and once appliances like a microwave, kettle and fridge as well as other sundries such as cutlery, crockery, cookware, utensils are added to the cost of insuring these contents, it can start to seem prohibitive. All of these expenses need to be factored into the cost of rent and then compared to the market rates for the property size and location. An unfurnished property may command a significantly smaller weekly rent, but the maintenance and insurance is limited to the house itself, not the replacement of the tenant’s contents. Depreciation advantages of a furnished property Letting a furnished property has an added advantage of increased depreciation deductions. Plant and equipment assets each allow the owner to claim depreciation deductions based on an individual […]

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